Tuesday, February 26, 2013

Section 80c of Income Tax

Section 80C of the Income Tax Act allows certain investments and expenditure to be deducted from total income up to the maximum of Rs 1,00,000.
  • Contribution to approved superannuation fund/public provident fund/recognized provident fund/statutory provident fund. Provident fund contribution should not exceed 1/5th of salary & public provident fund.
  • Payment of life insurance premium. It is allowed on premium paid on self, spouse and children even if they are not dependent on father or mother subject to a maximum of 20% of sum assured.
  • Payment in respect of non-commutable deferred annuity.
  • Unit linked Insurance policy of UTI/LIC.
  • Subscriptions to National Savings Certificates VIII issues.
  • Deposits with National Housing Bank.
  • Principal part of loan taken for acquiring Residential House Property; provided that the house should not be transferred within 5 years. Loan for land cost for residential house is also qualified.
  • Subscriptions to schemes of PSU's providing long term finance for housing, or of housing boards constituted in India for infrastructural development of cities/towns.
  • Notified annuity plan of LIC or of any other approved insurer.
  • Units of Mutual Fund or UTI.
  • Notified pension fund by UTI or approved mutual fund.
  • Tuition fees (not including donation or development fees) towards full-time education including play-school activities, pre-nursery & nursery classes, of any 2 children of an individual, paid to University, College or School in India.
  • Investments in shares or debentures with a lock-in-period of 3 years, of approved public company exclusively engaged in infrastructure facility or power sector.
  • Subscription to the bonds issued by NABARD as specified by Central Government.
  • Any sum deposited as 5 years time deposit under Post Office Term Deposit.
  • Any sum deposited in Senior Citizen Savings Scheme.
  • Any sum deducted from salary of Government employee (subject to maximum 20% of salary) towards deferred annuity plan for benefit of self, spouse or any children.
  • Term deposit with scheduled bank for a period of not less than 5 years as per scheme notified by Central Government.
  • Investing in units of notified mutual fund investing in approved public companies engaged in infrastructure facility or power sector.

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